U.S. Market Potential For Dried Distillers Grain With Solubles
Prior research presumes that the U.S. livestock feed demand for dried distillers grains with solubles (DDGS) can accommodate the rapid growth in DDGS production. The objective of this work is to reexamine the market potential for DDGS by considering factors that limit the adoption rate of DDGS. An estimate of DDGS market size requires information about DDGS inclusion rates, animal populations, and adoption rates. The rapid expansion of the ethanol industry will saturate the dairy and hog markets for DDGS by the end of 2009, while the beef and poultry use must triple to consume all available product. One must be circumspect of these forecasts for three reasons. First, the supply of DDGS is contingent on ethanol production. If the downturn in ethanol profitability spreads, less DDGS may be available to absorb. Second, in the short run, farms capable of consuming DDGS are not likely to shift, and thus animal populations are relatively fixed. However, the DDGS inclusion rates will most likely increase from current practices. Yet it is hard to imagine the market penetration rate will reach 100 percent for any class of livestock. Finally, export markets may also consume more DDGS than expected, reducing the pressure to expand US consumption. Thus, producers and consumer of DDGS would be well advised to pay careful attention to market developments as the US DDGS continues to grow.
|Date of creation:||2008|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: 765 494-4191
Fax: 765 494-9176
Web page: http://www.agecon.purdue.edu/
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Simla Tokgoz & Amani Elobeid & Jacinto F. Fabiosa & Dermot J. Hayes & Bruce A. Babcock & Tun-Hsiang (Edward) Yu & Fengxia Dong & Chad E. Hart & John C. Beghin, 2007.
"Emerging Biofuels: Outlook of Effects on U.S. Grain, Oilseed, and Livestock Markets,"
Center for Agricultural and Rural Development (CARD) Publications
07-sr101, Center for Agricultural and Rural Development (CARD) at Iowa State University.
- Simla Tokgoz & Amani Elobeid & Jacinto F. Fabiosa & Dermot J. Hayes & Bruce A. Babcock & Tun-Hsiang (Edward) Yu & Fengxia Dong & Chad E. Hart & John C. Beghin, 2007. "Emerging Biofuels: Outlook of Effects on U.S. Grain, Oilseed, and Livestock Markets," Food and Agricultural Policy Research Institute (FAPRI) Publications 07-sr101, Food and Agricultural Policy Research Institute (FAPRI) at Iowa State University.
When requesting a correction, please mention this item's handle: RePEc:pae:wpaper:08-12. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Debby Weber)
If references are entirely missing, you can add them using this form.